Addis ababa: A prominent investment advisor and businessman has forecasted a transformative economic future for Ethiopia, driven by a 2.5 billion USD urea fertilizer complex deal with Dangote Industries Limited. This landmark investment is expected to eliminate billions of dollars in fertilizer imports, marking a significant shift in Ethiopia’s economic landscape.
According to Ethiopian News Agency, Zemedeneh Nigatu, CEO of CBE Capital Investment Bank and a seasoned Ethiopian-American investment advisor, highlighted Ethiopia’s positioning for unprecedented economic growth. The convergence of natural gas production and large-scale fertilizer facilities is set to transform the East African nation into an industrial powerhouse, reducing its dependency on imports and boosting its export capacity.
The recent discovery of substantial natural gas reserves in the Kalub and Hilala fields is a pivotal development for Ethiopia’s industrial ambitions. Zemedeneh noted that these reserves will support pipeline infrastruc
ture critical to the burgeoning fertilizer industry, addressing a long-standing gap in industrial capacity.
Historically, Ethiopia has imported between $1 billion and $2 billion worth of fertilizers annually, a strain on foreign currency reserves. Zemedeneh emphasized the availability of local resources, stating, “We were spending billions of dollars in hard-earned foreign currency to other countries… that resource was actually readily available in Ethiopia.”
The partnership with Dangote to develop fertilizer production facilities will enable Ethiopia to transition from a fertilizer importer to a potential exporter. This Pan-African collaboration with Nigeria underscores the continent’s capacity for large-scale cooperative ventures, according to Zemedeneh.
The fertilizer plants aim to modernize Ethiopia’s agriculture sector, the backbone of the economy, while reducing import dependency. Zemedeneh drew parallels to the United States, where agriculture remains a top export, highlighting Ethiopia’s potentia
l as an export powerhouse.
Ethiopia’s energy capacity, bolstered by major hydroelectric projects, positions it as Africa’s second-largest electricity producer. This abundant power offers competitive advantages for manufacturing and industrial development, attracting both domestic and multinational companies.
Ethiopia’s energy surplus is already benefiting neighboring countries through electricity exports, supporting African integration objectives and generating foreign currency. Zemedeneh’s economic confidence is backed by his successful forecasting track record, noting that Ethiopia has exceeded projections made 15 years ago.
Currently Africa’s fifth-largest economy, Ethiopia is projected by the IMF to be the fastest-growing economy among the continent’s five largest over the next five years. Long-term forecasts by Goldman Sachs suggest Ethiopia’s GDP could reach 1.6 trillion USD by 2040, potentially making it the world’s 16th largest economy by 2060.
Despite this optimistic outlook, Zemedeneh acknowledg
ed challenges like inflation, which has been problematic for 15 years. However, recent progress shows inflation dropping from 35 percent to 13.5 percent over two years, according to National Bank forecasts.
Zemedeneh emphasized the importance of economic reforms and private sector strengthening for sustainable growth. With a young population, Ethiopia has a wealth of human capital, which Zemedeneh believes will drive the country’s economic transformation.
He stressed the need for ongoing reforms to sustain rapid growth and unlock Ethiopia’s full potential, underscoring the critical role of a strong, empowered private sector in partnership with the state.